Washington, D.C./Cairo, June 30,
2010 - IFC, a member of the World Bank Group, agreed to invest $120
million in Egyptian Refining Company, which will be part of the largest
project-financing transaction in Egypt, to promote enhanced environmental
standards and cleaner domestic fuel sources in Egypt.
IFC’s equity investment will be used
by Egyptian Refining Company, a platform company of Citadel Capital, Africa’s
largest private equity firm, to build a $3.7 billion hydro-cracking and
coking refinery that will allow Egypt to transform locally available fuel
oil into lighter fuel products, such as ultra-low sulfur diesel, for the
domestic market. The company also will help upgrade an adjoining
state-owned refinery to increase its energy efficiency and environmental
performance, resulting in reduced sulfur dioxide emissions.
“IFC is a valuable partner that has
met our financing needs in an innovative and efficient manner,” said Dr.
Ahmed Heikal, Chairman and Founder of Citadel Capital. “We appreciate
our long-term relationship with IFC and will draw on their global expertise
as ERC follows international best practices in environmental and social
management and works with local communities. These are all important considerations
as we continue to grow our 15-industry, 14-country investment footprint.”
IFC is assisting Egyptian Refining Company
in designing and implementing a community investment strategy to maximize
the positive social impact the company will have on local communities.
IFC also is working with the company and other financiers to create
a robust environmental monitoring system.
“This project has the potential to
optimize the use of Egypt’s petroleum product infrastructure, elevate
the environmental and social standards within the refining industry, and
create significant employment opportunities,” said Somit Varma, IFC Global
Head of Oil, Gas, Mining, and Chemicals. “IFC is very pleased to
support the project and to help catalyze new private sector investments
through our strong partnership with Citadel Capital and the Government
The investment is part of IFC’s strategy
to help enhance development of Egypt’s energy sector. Egypt currently
lacks the refining capacity to meet its growing demand for lighter fuels
such as diesel and relies heavily on the importation of these products.
The Egyptian Refining Company investment and such other initiatives
will help increase Egypt’s ability to produce fuels domestically and therefore
create sizeable savings to the economy through import substitution.
IFC, a member of the World Bank Group,
creates opportunity for people to escape poverty and improve their lives.
IFC fosters sustainable economic growth in developing countries by supporting
private sector development, mobilizing capital for private enterprise,
and providing advisory and risk mitigation services to businesses and governments.
IFC new investments totaled $14.5 billion in fiscal 2009, helping channel
capital into developing countries during the financial crisis. For more
information, visit www.ifc.org.
About Citadel Capital
Citadel Capital (CCAP.CA on the Egyptian
Stock Exchange) is the leading private equity firm in the Middle East and
Africa. Citadel Capital focuses on building regional platforms in select
industries through acquisitions, turnarounds, and greenfields executed
via Opportunity-Specific Funds. The firm’s 19 OSFs now control Platform
Companies with investments worth more than US$ 8.3 billion in 14 countries
spanning 15 industries, including mining, cement, transportation, food
and energy. Since 2004, Citadel Capital has generated more than US$ 2.5
billion in cash returns to its co-investors and shareholders (on investments
of US$ 650 million), more than any other private equity firm in the region.
Citadel Capital is the largest private equity firm in Africa by PE assets
under management (2005-2010, as ranked by Private Equity International).
For more information, please visit www.citadelcapital.com.